Broadcom (AVGO) remains in a solid position to continue driving up revenue growth due to the high demand around artificial intelligence networking and the launch of Google’s (GOOG)(GOOGL) Ironwood, or TPUv7 chip, according to Susquehanna.
Broadcom has been a key partner in the design and manufacturing of Google’s tensor processing units for about a decade.
“Ironwood is tracking better than expected as Google signed Anthropic (ANTHRO) as a customer earlier this quarter (for up to 1M TPUs), with Meta (META) also reported to be another major customer here,” said Susquehanna analysts, led by Christopher Roland, in an investor note. “Last quarter, CEO Hock Tan also announced that one of Broadcom’s XPU prospects became a qualified customer (we believe Anthropic), representing over $10B in orders of ‘AI racks’ expected in 2HFY26 (we note this is likely on the TPU design).”
Susquehanna increased its price target on Broadcom to $450 from $400 and retained its Positive rating.
Susquehanna also highlighted a recent deal with OpenAI (OPENAI) where it has agreed to supply up to 10 gigawatts of AI racks.